Before the bell: 104%

As Donald Trump faces mounting criticism, Japan and South Korea begin trade talks with the U.S. Europe is sending the Italian Prime Minister to Washington.

After three days of unrest and turbulence driven by Donald Trump’s trade war, global stock indices briefly seemed to recover. The U.S. is in talks with South Korea about a potential trade agreement, and negotiations with Japan have also begun. Notably, it’s not Ursula von der Leyen who will be heading to Washington for Europe, but rather Italian Prime Minister Giorgia Meloni. Investors welcomed the negotiations. The average European stock rose 2.5% yesterday. Belgium’s Bel20 index climbed by 3.1%. In early trading, the S&P 500 gained 3.3%, and the Nasdaq added 4%, with green numbers across the board. But investor worries weren’t gone for long. Beijing announced it would “fight to the end,” and Trump fired back with a 104% tariff on many Chinese goods. Outraged investors pushed U.S. markets back into the red. The S&P 500 and Nasdaq closed the day down 1.6% and 2.2%, respectively.

In Japan, the Topix is down 3.5% this morning. Konica Minolta lost 9.3% in value. The Hang Seng index in Hong Kong is down 1.5%. Lenovo took a 6% hit, while Xiaomi managed to rise 3.7%. Kia lowered its revenue targets for 2030, now aiming to sell 1.26 million electric vehicles annually—down from its previous target of 1.6 million. The South Korean carmaker also aims to sell 993,000 hybrid vehicles that year. In 2023, Kia sold 3.1 million vehicles, of which 201,000 were electric. Today in Belgium, we’ll see annual results from Ageas and logistics real estate specialist VGP. In the U.S., Delta Airlines and brewer Constellation Brands will publish their earnings later today.

A deal in private equity land

U.S. investment firm Kohlberg Kravis Roberts & Co. (KKR) is set to acquire Karo Healthcare from Swedish private equity fund EQT AB. KKR is offering 2.6 billion dollar for the Swedish online pharmaceutical company. The move is notable given that most deal-making has been put on hold due to Trump’s trade war. Karo Healthcare employs 400 people and operates in more than 90 countries. The company is best known for its skincare products. EQT AB took the company private in 2022 for 1.4 billion dollar. If the deal goes through, the investment will have yielded an 85% return—another solid result for EQT AB. Savvy savers following the “Investing for Beginners” series may recall that both Investor AB and Belgium’s Brederode are reference shareholders in EQT.

Musk vs Navarro

As the trade war drags markets down for the fourth day in a row, domestic criticism of Trump is growing—even near the White House. There are clearly two camps. Peter Navarro, the architect of Trump’s tariffs, recently stated that Elon Musk “isn’t a carmaker, but someone who assembles cars using foreign parts.” Elon Musk, one of the biggest donors to Trump’s presidential campaign, clapped back on his own social platform X, calling Navarro “dumber than a bag of bricks.” Kimbal Musk, Elon’s brother and board member at Tesla and SpaceX, also criticized the tariffs, calling them a tax on the American consumer. Perhaps this resistance is the reason markets haven’t fallen even further. Investors are still hoping for a return to common sense—but with Trump, that’s never a given.

Did you know…

that Trump claims his tariffs bring in more than 2 billion dollar per day for the U.S.? No one really knows how he came up with that number. But according to the former president, “America will soon be rich again.” Who still believes him?

This article was translated from Dutch and was originally published on Spaarvarkens.be.